ADB Forecasts the Philippines as the Fastest Growing Economy in Southeast Asia for 2023-2024

The Philippines is projected to be the growth leader in Southeast Asia, according to the latest Asian Development Bank (ADB) report. The ADB’s Asian Development Outlook, released in December, forecasts the Philippine economy to grow by 5.7% in 2023, maintaining the rate forecasted in September. This growth rate positions the Philippines as the top performer in the region, surpassing other countries such as Vietnam (projected at 5.2%), Indonesia (5%), Malaysia (4.2%), Thailand (2.5%), and Singapore (1%).

For 2024, the ADB has retained its growth forecast for the Philippines at 6.2%, aligning with the government’s growth goal of 6.5% to 8% for the year. The Philippine economy, which grew by 5.9% in the third quarter of 2023, bringing the average growth for the January to September period to 5.5%, is expected to continue this momentum. Factors contributing to this growth include higher public investment, rising consumer spending, especially in sectors like hotels, restaurants, and tourism, amid a strong recovery of international tourism across Southeast Asia. Additionally, infrastructure projects underway are anticipated to support further growth.

In terms of inflation, the ADB maintained its forecasts for the Philippines at 6.2% for 2023 and 4% for 2024. As of November, headline inflation in the Philippines had eased to a 20-month low of 4.1%, mainly due to slower food price increases. However, this average inflation rate from January to November still exceeded the Bangko Sentral ng Pilipinas’ target range of 2% to 4%. Despite the decline in inflation across developing Asia, ADB chief economist Albert Park highlighted the risks from elevated global interest rates and potential climate events such as El Niño, emphasizing the need for governments in Asia and the Pacific to remain vigilant to ensure sustainable economic growth​​​​.